Which crypto remittance service is most likely to dominate the Latin American market
A hatred of transfer fees unites all levels of society. Even Salvadoran President Nayib Bukele searched Western Union and other intermediaries as Bitcoin Adoption Day approaches in the country. The Central American country’s GDP was $ 26.9 billion in 2019, and remittances that year were around $ 6 billion. Bukele claimed that approximately $ 400 million was going to other sources as a transfer fee.
After launch, with over a million people using the Chivo wallet and 205 Bitcoin ATMs around the country, the emergence of a new transfer corridor could threaten traditional intermediaries and payment giants.
I drove to the Consulate of El Salvador in #Atlanta Friday afternoon. The Chivo ATM was alive and well, and citizens can put dollars back in their pockets in El Salvador for free, at the speed of light. It’s huge. pic.twitter.com/jPuJrOb3Kg
– Sol Dude (@dude_sol) September 17, 2021
Across the world, crypto transfer corridors have sparked the interest of users who need to send money home instantly and at low cost or no cost.
Sherlock Communications Blockchain LatAm 2021 report noted,
“Remittances to and from family and friends abroad were cited as a reason for investing in digital money systems by one in five Latin Americans…”
According to the same report, Venezuelan refugees also used crypto assets to avoid fees.
Outside of this use case, global brands have started using the Lightning Network in El Salvador. Some experts have even predicted that bypassing payment giants like Visa and MasterCard could generate more profits and lower prices.
Outside of Latin America, Ripple has made efforts to use its on-demand liquidity service (ODL) to open a crypto transfer corridor between Japan and the Philippines.
Lightning Network vs Dash vs Ripple
The question arises: which crypto transfer service is most likely to dominate the Latin American market?
The penetration of the Lightning Network is increasing day by day. At the time of going to press there were 26,861 knots and the median base charge was one satoshi. The Flex digital payments network also added support for Bitcoin owners and those who use Lightning-based wallets like Strike and Chivo.
However, the Dash aftermarket also has a strong presence in Latin America. According to the Sherlock Communications report, there are over 11,000 Dash Pay ATMs in Mexico. Dash has also been accepted by several leading companies in Venezuela.
Besides these two options, Ripple has also expressed interest in reaching the Latin American market. In a statement, RippleNet Europe chief executive Sendi Young said:
“Through Paydek, Ripple is strengthening its presence in Africa and Latin America to drive innovation in digital remittances, in regions where faster payments are essential to people’s livelihoods.”
As cryptocurrency enters the Latin American economy, it looks like more money transfer corridors could open up and bring various use cases.